ON OFFICE VALUATIONS. XXX111 



The best method of treating this case is to suppose 

 H.to stand for such a sum, that there will be no loss 

 arising from a lower rate of interest before the next 

 valuation. Accordingly, in the preceding formula, n 

 must be the number of years intervening between two 

 valuations. If such a process should give too little 

 profit at one valuation, the same item will be larger in 

 the next, and vice versa : so that there will be a con- 

 tinual tendency to correctness. If, for instance, the 

 valuations be made yearly (for which this very cir- 

 cumstance is one reason among many), then H (1 -fr x ) 

 -r-(l -j-r) should be taken for H, and the existing poli- 

 cies may have the benefit when r' is greater than r. 



